10 Steps to Help a Newly Alone Spouse

Editor’s note: In this edition of What’s Working Now, an AdvisorRADIO feature in which Horsesmouth members tell us about recent success they have had running and growing their businesses, we hear from advisor Jorge Blanco, who guides clients and prospects who have recently lost a spouse.

The following article includes edited excerpts of this conversation, or you can listen to the full interview below.

I started my career at Ameriprise Financial^® in 2002, and since 2010 I’ve been independent under LPL Financial. I’m a CFP^® and hold a few other designations. I think I’ve built a client base of phenomenal clients. I’ve been fortunate to be able to work with wonderful people.

I think I’m entering a stage of my career where a lot of things are learned by experience. I’ve found that there’s a huge gap in my knowledge regarding what a “suddenly alone” spouse faces and how to handle those things. I’m working with some of my clients on filling that knowledge gap.

It started with a couple who had been my clients for about five years. He was a very successful professor, and the wife was a teacher. He handled all the finances, even though she came to some meetings. He was in charge of absolutely everything. She didn’t have any interest in the investments and deferred all the decisions to her husband. He had direct contact with me and controlled the decision making in the household.

Then he fell ill to cancer and passed. He had had cancer on a few previous occasions but beat it. This time it was pretty advanced. We were able to try some things, such as obtaining an advance on death benefit from a life insurance policy in order to be able to pay for some medical trials. Unfortunately, the trial didn’t work.

We had one conversation that broke my heart. When this client was at MD Anderson Cancer Center in Houston, he had just been given the bad news and told what it would cost to see if he could survive. He reached out to me. He asked me, “If I spend hundreds of thousands of dollars on this kind of treatment, is that going to alter my wife’s ability to retire? I don’t want to do anything for the sake of living a few months longer, maybe a few years longer, that can cost my wife the ability to live retirement the way we planned it.” We went through some of the policies he had and there were some accelerated death benefits we were able to tap into.

During the time that my client had fallen ill, we reviewed his old wills and estate planning documents. I referred him to an attorney that I have worked with for 18 years and they updated their estate plan to ensure that it covered everything the couple had today versus 20-something years ago.

After the husband’s death, the wife reached out to me, but I really wasn’t aware of everything that needed to be done. So together we scheduled funeral arrangements, contacted Social Security, went to the DMV, and scheduled appointments at the Social Security office to go over survivor benefits.

She was overwhelmed and alone here in Florida. Her family lives up north and her son is an ER doctor in Alaska, not able to help much. She didn’t even know how to pay bills or what bills they had. I went to see my client about three days before he passed, when he was home in hospice. I reached out and said, “How can I help?” She said she didn’t know what to do or what needed to be done.

I learned by googling things and knowing a few financial things she had to get done. I would just go to her house and say, “Let’s do this and this.”

There are a lot of emotional roller coasters that people go through when they’re grieving. Not only are they sad, but sometimes they’re angry they’re being left alone. It was really difficult at the time, but I know that looking back two and half years after my client’s death, his widow is very grateful. She’s happy where she’s at now and she’s had the time to grieve.

It was a very hard learning experience, above and beyond the duties of a financial advisor. But I think I was able to definitely help her through that difficult time. And as a result, I’ve gathered a few other clients that were in the same situation. Now it seems like I’m the go-to person when you lose your spouse, at least for that group of friends.

Some of my clients know each other. I do events throughout the year. Some of them have become friends. It’s become known what I did for the professor’s wife, and when another client passed they said, “You need to talk to Jorge and he’ll guide you through this stuff.”

Then one of my client’s friends passed and I was able to get a new client because my client basically said, “I don’t know what to do with this. You need to at least call my advisor. There’s no obligation whatsoever, but at least he can tell you what needs to be done.” A few months after they handled the transfer of the assets and met with me, we started a new relationship.

I’ve been fortunate to not have had any close family pass away, where I’ve had to take responsibility or step in and be the main helper. But I’ve had other clients who have lost someone over the last couple of years. I feel like 2019 was a terrible year for losing clients. But I think I’ve been able to more proactively help out those spouses, even though some of them were more hands-on and already knew what to do. I offered myself as a resource to guide them through it.

There are literally hundreds of things that need to be done when someone passes away, but I think these are the 10 most important.

1. Ask for help

Being able to think straight through mourning the loss of a spouse is incredibly difficult. Knowing what needs to be done can be difficult, and emotion gets in the way. Relying on friends, trusted people around you, adult children, whoever, can take some of the burden away. It’s extremely important.

I think friends or children can help arrange funeral services and burial or cremation. They can also notify friends and family. I’m sure there’s a long list of people who would be interested in learning about the loss of a loved one. And having people on your side who can help you spread the word is extremely helpful. Reach out to adult children and say, “I need help. We need to arrange funeral services. We need to let people know.” Taking on everything on your own is extremely difficult, especially in a time when you are at a loss.

One of the first people to reach out to should be the financial advisor. Because that advisor can start gathering documents needed to transfer assets to perhaps pay a mortgage or float your finances during this short-term period of loss. Step number one, ask for help and reach out to your advisor.

2. Notify Social Security

Notify Social Security and immediately schedule an appointment with them to go over any survivor options. The rules are completely different depending on if the spouse was already receiving Social Security or not. Depending on the age, there is a very small death benefit that the survivor receives. It’s important to at least schedule that appointment to see what options you have.

I’ve been learning a lot about Social Security through Horsesmouth. There were Social Security topics that I had to learn to get my CFP^® and CRPC^®, but I think Horsesmouth brings detailed information that is up-to-date, not only for distribution strategies while alive but also after death. Horsesmouth has been an incredible resource to my practice from a Social Security point of view.&v=qa0xz50bm5ict4jawlnke3xt

3. Notify employer

If the deceased spouse was working, immediately contact the employer, not only to notify them about the death, but also to obtain information about any benefits that the survivor may be entitled to receive, such as the life insurance benefit.

Also, if the spouse died an accidental death, there may be substantial amounts of money from an accidental death and dismemberment policy. A lot of times people sign up for that benefit because it costs pennies to have, and it could be a substantial windfall that can help the family.

Also check on any vacation pay or PTO that the survivor is entitled to. You can get that after notifying the employer. And it’s not subject to Social Security or Medicare taxation.

Going back to the professor who was my client, when we knew he was dying we jumped on the phone and called the employer. We were transferred to the HR department and they were extremely helpful regarding everything—phone numbers for different policies, documents that needed to be completed, etc. Being able to work with HR was very valuable for my client. We obtained the phone number of the 401(k) company, the health insurance company, and I think even a cancer policy through the employer. We were able to get some reimbursements for expenses incurred during his cancer treatment.

4. Request death certificates

Before you start contacting institutions, you need to obtain copies of the death benefit, or certificate. In the state of Florida, for instance, there are two types: a short form and a long form. The long form lists the cause of death, believe it or not. Some financial institutions require the long form instead of the short form.

To be safe, people should order at least 10 different originals of the death certificates. Some banks, broker dealers, custodians, insurance companies, etc. accept copies, but others require originals. So starting with at least 10 is important. That death certificate is what’s going to be required to receive death benefits from life insurance, and transfer bank accounts and investment accounts to the survivor’s name.

5. Go to the bank

If the spouses have a joint bank account, go to the bank and change it to the survivor’s name only. My suggestion is to make it an individual account with a transfer on death provision to an adult child, a trusted friend, or a trust. Don’t just make it an individual account or it will go through probate. If you want the account to transfer on death, then go to the bank and transfer it to the survivor’s name and add those TOD provisions.

In the case of the professor and his wife, they had bank accounts at Bank of America, Wells Fargo, and a credit union. We had to make a trip to each of those banks and deal with separate sets of papers. In fact, some of the banks, no matter how clear-cut it was, required additional documentation before they would release the funds. But it is still a very important step. Go to the bank and try to gather those documents.

As I was guiding the wife, I didn’t have any legal powers to do anything on her behalf. I was simply going to these appointments with her to guide her through it and learn about what needed to be done. I had never been in this situation myself with a family member or another client, so I just did it to help her. She literally didn’t even know how to pay bills.

So I had to go in to appointments and say, “I’m her advisor. The husband passed, what do we need to go to get things transferred to her name?” I don’t think anyone thought I was taking advantage of an elderly woman. She would break out crying in the meeting, so I think they found I was truly helping her. They saw me as someone going above and beyond the call of duty in order to help someone he cares for. I truly care for my clients.

There was nothing in it for me besides making sure my client’s wishes were followed by having his wife be the beneficiary of all accounts. I think she also had quite a bit of trust in me being able to help her. Their son wasn’t able to take the time off to help his mother, but he is also my client, so he trusted me too.

6. Notify credit card companies and auto loans

It is important to know that if the surviving spouse was not listed as a user for a credit card, she is not legally liable for paying any debts under the deceased spouse’s name. The same applies to an auto loan. This is important to know because sometimes they’re going to be reaching out and demanding that the surviving spouse pays some of that debt. In the case of auto loans, I didn’t know this until I went through it with my client. She said her phone was ringing all the time from credit card companies saying that there were balances, that it was past due, and that she was afraid.

She asked me, “Do I need to pay this?” So we reached out to an estate attorney that I’ve worked with for years, and he explained her legal options. There was no legal obligation to pay off credit card debts or auto loans that were under the spouse’s name only. The vehicle they had was absolutely upside down in value and they just said, “Here’s the keys. Come get them.” (Even though I think the moral thing to do would be to pay them off.) The legal ramifications are something people are not aware of.

7. Notify pension providers

If the deceased spouse was receiving any type of pension payments, that provider needs to be notified as well. Because if there are no survivor benefits, there will be no further payments. However, if the deceased spouse had selected survivor benefits, then payments need to be changed to the survivor to receive the income.

8. Gather official documents

Gather everything such as house deeds, car titles, and any other property-related documents. Have it all in front of you to then be able to go to the companies and change the house, the vehicles, and any other assets that are jointly owned into the surviving spouse’s name. You don’t want anything with the deceased spouse’s name standing.

If any assets go through probate, like any bank accounts that didn’t have a beneficiary or transfer on death, those assets are frozen until the estate has opened a probate case and all the liabilities are paid first. It’s important to proactively transfer things to the survivor’s name.

Then you need those documents to apply for life insurance benefits, transfer accounts, and roll over retirement plans. Change the ownership of joint investment accounts to an individual account under the survivor’s name with a transfer on death to maybe the children or the trust if they have one set up. This is the time when you start transferring assets to the survivor’s name after presenting the death certificate documents, completing account transfer forms, etc.

9. Deal with social media

Then I would say go through social media accounts. Either cancel them entirely or respond to people who commented on the loss and then shut them down.

10. Seek grief counseling

Don’t be afraid to seek grief counseling. This is an unprecedented time in the survivor’s life. It’s really difficult to go through it alone. So encourage your clients to seek counsel and join groups of people who have gone through this experience in the past. It can be extremely helpful.

I saw a huge change in my client’s life when she joined a grief counseling group about eight or nine months after her husband’s death. For months, she just shut down. She was upset and crying and stopped going into work. I would check in with her every couple of weeks to see how she was doing. There was a big change in her life when she joined these groups and was able to learn from other people’s experience. Maybe she was able to share some emotions that she couldn’t talk about with me as an advisor or her son or anyone else. I think having people around who have experienced what you’ve experienced can be something helpful in getting you to move on with your life.

The son of this professor and his wife is a prominent ER surgeon in Alaska, and also my client. I fly out to see them personally. He was extremely close with his father and it was difficult for him. I sent him notes to let him know that there’s nothing that can be done, but if he needs someone to just listen, to feel free to reach out. I think a relationship needs to be fostered prior to the death. So if you work with older clients—in their 50s, 60s—you should have a relationship with the children. Because those are the next people that are going to inherit the monies.

And not only can you help them because they’re the children of someone you worked with for a number of years, but it allows you to continue to serve the household. If you don’t establish relationship with the children early on in your relationship with a client, those are assets that can leave your practice very quickly. I just happen to have had this son as a client for a number of years, so it was very easy to keep the assets in-house.